All Roll Calls
Yes: 258 • No: 0
CaliforniaAB 7862025-2026 Regular SessionHouseWALLET
California Pollution Control Financing Authority: name change.
Sponsored By: José Luis Solache (Democratic)
Signed by Governor
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Bill Overview
Analyzed Economic Effects
15 provisions identified: 10 benefits, 2 costs, 3 mixed.
Seismic retrofit loans for homes, businesses
The law creates a Seismic Safety Capital Access Loan Program to help lenders finance seismic retrofits for homeowners and small businesses. The program covers lender losses on qualified loans and caps the qualified loan amount at $250,000. Loss coverage lasts up to 10 years, with funds recaptured at maturity or after 10 years. A continuously appropriated fund supports the program, with a 5% cap on admin costs (plus 5% of recaptured money), and any investment earnings remain in the fund.
ADA retrofit loans for small businesses
The law creates an ADA Small Business Capital Access Loan Fund. Eligible small businesses (30 or fewer FTEs or under $5 million in gross income, and not offering overnight stays) can get qualified loans up to $50,000 to make ADA fixes at facilities under 10,000 square feet. The program uses a loan‑loss reserve, limits coverage to five years, recaptures funds at maturity or five years, and caps admin costs at 5% of the first appropriation plus 5% of recaptured money.
Employee Ownership Hub to help transitions
When funded, CalOSBA sets up a California Employee Ownership Hub. The Hub works with state partners to expand access to capital programs, and to provide education and referrals for broad‑based employee ownership transitions. The Hub must report to the Legislature.
Financing help for recycling businesses
Operators of reverse vending machines and processors can apply to the state’s climate financing authority for capital to build collection and processing networks. Businesses and individuals can also apply to the State Energy Commission for loans and grants to demonstrate recycling equipment.
More financing help for small businesses
The law helps small businesses follow local air‑district rules. The Treasurer and the state financing authority can work with districts to offer loans, guarantees, and other help. More lenders can join the Capital Access Loan Program, including SBA partners, small business investment companies, and certified micro‑lenders. When SBA‑required data would harm a firm competitively, the Authority can keep that financial data confidential under adopted rules.
Flexible credits for organics purchasing
Local governments can count certain direct spending toward their organics buying targets through December 31, 2035, up to 10% of the target. Before new rules are issued, each $21.38 spent counts as one ton. One ton of recovered edible food counts as one ton. Mulch from tree trimming and compost from worm, small (≤100 cubic yards on site), and mushroom operations can also count if documented, safe, and backed by a local ordinance. By January 1, 2027, pipeline biomethane made only from landfill‑diverted organic waste is added to the list of eligible products. The department, the climate financing authority, and the state’s development bank can share information with landfill operators about financing options for methane capture and leak reduction projects.
More ways to meet compost targets
Local governments can count certain direct spending toward organic‑waste procurement goals through December 31, 2035. Eligible costs include community composting projects, equipment used only to apply compost or mulch that year, and compost or mulch distribution sites, following department rules. The law also confirms that giving compost or mulch for free, or paying incentives to use it, serves a public purpose. This lets cities and counties offer these benefits to help meet goals.
Loans and grants to clean brownfields
When funded by the Legislature, the state’s climate financing authority runs CALReUSE loans and grants for brownfield cleanup tied to infill housing and mixed use. Each year awards are made, the Authority reports project details, status, and the number of housing units helped.
Cities may add fees for compliance
Local governments can charge and collect fees to recover their costs for following the organics rules. They may bill residents, businesses, or service users. The law does not set the fee amounts.
New utility bill charge funds projects
The law lets the state’s financing authority back utility projects with bonds and add a special charge to customer bills to repay them. The plan must show how the charge is set and adjusted at least once a year, and customers cannot avoid it. A first‑priority lien secures the revenues, and a court can order revenues set aside if there is a default. The Authority reviews and decides on bond applications, can charge nonrefundable application fees, must act within set timelines, can use emergency rules, and may form a single‑member LLC to issue bonds.
Organic waste targets and penalties
The law requires statewide rules to meet California’s 2020 and 2025 organic waste reduction goals. The rules must also aim to recover at least 20% of edible food for people by 2025. Cities must meet recovered organic product buying levels of 30% in 2023, 65% in 2024, and 100% in 2025 or face administrative penalties. These penalties start two years after the rules take effect (rules can start on or after January 1, 2022).
Stronger rules for utility bond financing
Rate‑reduction bonds are paid only from pledged utility project property and related revenues, not a utility’s general credit. The Authority and any single‑member LLC it uses cannot file bankruptcy while payments tied to project property are still due. After December 31, 2036, the Authority cannot approve new rate‑reduction bond issuances. If the Authority refuses to qualify an issuance, it must give written reasons and cannot change project‑property terms. When a local ratepayer advocate already reviews a publicly owned utility’s determinations, some state review steps do not apply.
Faster clean-air funds via Treasurer
The state air board can route money for replacing stationary source equipment through programs run by the State Treasurer or the climate financing authority. This lets the state use existing programs to deliver funds for eligible projects.
Flexibility and exemptions for organics rules
Jurisdictions with a rural exemption on January 1, 2024 stay exempt from certain collection and buying rules until January 1, 2037, with a renewal process after that. The department can set an adjusted buying schedule without the usual rulemaking steps. A city or county with 2022 violations could file a notice by March 1, 2022 and get specified penalty relief if it follows an approved plan; some 2023 penalties may also be waived after full compliance. Jurisdictions can use a qualifying local waste study to set per‑person buying targets for up to five years. Starting January 1, 2027, a jurisdiction may meet a five‑year target (five times its annual target) if it calculates it and notifies the department; also, bear bins are exempt from the state lid color rule.
Tax changes for Authority projects
If you hold a possessory interest in an Authority‑financed facility, that interest is taxable. Your contract must also make you pay any difference if that tax is less than what you would owe as the owner. Transfers of title or leases to and from the Authority for qualifying projects are not treated as taxable sales. The sales‑tax exclusion applies only to projects that meet Section 44508 rules (as amended in 1999) and not to certain refinancing refunds.
Sponsors & Cosponsors
Sponsor
José Luis Solache
Democratic • House
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
House vote • 9/10/2025
Item 273 — Assembly AFLOOR
Yes: 79 • No: 0
Senate vote • 9/9/2025
Item 366 — Senate SFLOOR
Yes: 40 • No: 0
Senate vote • 6/27/2025
Item 114 — Senate SFLOOR
Yes: 38 • No: 0
legislature vote • 6/9/2025
Vote in CS42
Yes: 8 • No: 0
House vote • 5/15/2025
Item 167 — Assembly AFLOOR
Yes: 69 • No: 0
legislature vote • 5/7/2025
Vote in CX25
Yes: 15 • No: 0
legislature vote • 4/21/2025
Vote in CX27
Yes: 9 • No: 0
Actions Timeline
Chaptered by Secretary of State - Chapter 710, Statutes of 2025.
10/13/2025SenateApproved by the Governor.
10/13/2025legislatureEnrolled and presented to the Governor at 3 p.m.
9/22/2025legislatureSenate amendments concurred in. To Engrossing and Enrolling. (Ayes 79. Noes 0. Page 3236.).
9/10/2025HouseIn Assembly. Concurrence in Senate amendments pending.
9/9/2025HouseRead third time. Passed. Ordered to the Assembly. (Ayes 40. Noes 0. Page 2704.).
9/9/2025SenateRead second time. Ordered to third reading.
9/8/2025SenateRead third time and amended. Ordered to second reading.
9/5/2025SenateRead second time. Ordered to third reading.
9/2/2025SenateRead third time and amended. Ordered to second reading.
8/29/2025SenateOrdered to third reading.
8/29/2025SenateAction rescinded whereby the bill was read third time, passed, and to Assembly.
8/29/2025SenateIn Senate. Held at Desk.
8/21/2025SenateOrdered to the Senate.
8/21/2025HouseAction rescinded whereby the bill was re-referred to Com. on B. & F. pursuant to Assembly Rule 77.2.
8/21/2025In committee: Set, first hearing. Hearing canceled at the request of author.
8/20/2025HouseRe-referred to Com. on B. & F. pursuant to Assembly Rule 77.2.
6/30/2025HouseIn Assembly. Concurrence in Senate amendments pending.
6/27/2025HouseRead third time. Passed. Ordered to the Assembly. (Ayes 38. Noes 0. Page 1809.).
6/27/2025SenateRead second time. Ordered to Consent Calendar.
6/24/2025SenateFrom committee: Be ordered to second reading file pursuant to Senate Rule 28.8 and ordered to Consent Calendar.
6/23/2025SenateFrom committee: Do pass and re-refer to Com. on APPR. with recommendation: To Consent Calendar. (Ayes 8. Noes 0.) (June 9). Re-referred to Com. on APPR.
6/9/2025SenateFrom committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on B. P. & E.D.
6/3/2025SenateReferred to Com. on B. P. & E.D.
5/28/2025SenateIn Senate. Read first time. To Com. on RLS. for assignment.
5/15/2025Senate
Bill Text
Chaptered
10/13/2025
Enrolled
9/12/2025
Amended Senate
9/5/2025
Amended Senate
8/29/2025
Amended Senate
6/3/2025
Introduced
2/18/2025